VIRGINIA UPL OPINION 144


Lay Employees of Automobile Liability Insurance Carriers Appearing in General District Court on Behalf of Carrier and Insured.

Inquiry:
An insurance carrier wishes to know if it would constitute the unauthorized practice of law for its non-lawyer agents to file Warrants in Debt in Virginia General District Courts. The Warrants would be filed pursuant to the carrierís subrogation rights acquired from its insured. The agent would attempt to receive judgments on the carrierís behalf, which amount requested on the Warrant in Debt would include the insuredís deductible. Upon judgment and recovery of the full amount, the carrier would then forward the deductible to the insured.

Opinion:
The Committee is of the opinion that any activity on behalf of the insurer in General District Court by non-lawyer employees of an insurance carrier is governed by the statutory requirements as set forth in §16.1-88.03, Va. Code Ann. (1990 Cum. Supp.).

It is the Committee’s understanding that the relevant Code section has been recently amended by the 1992 session of the Virginia General Assembly and that those amendments will be effective July 1, 1992. Those amendments significantly broaden the ability of a corporationís employees to pursue matters on behalf of the corporation, and now permit a corporation's president, vice-president, treasurer or other officer or full-time bona fide employee, upon proper authorization by the board of directors, to prepare, execute, file, and have served on other parties, in any proceeding in a general district court, a warrant in debt, motion for judgment, counterclaim, crossclaim, and garnishment summons, without the intervention of an attorney. [emphasis added] The statute explicitly precludes a non-lawyer from filing a bill of particulars or grounds of defense or to argue motions, issue a subpoena, rule to show cause, capias, file or interrogate at debtor interrogatories, or to file, issue or argue any other paper, pleading or proceeding not specifically enumerated.

The Committee is of the opinion, however, that such statutorily permissible activity may be undertaken only on behalf of the employer and not on behalf of the employer/insurance carrier’s insured. Thus, the Committee opines that it would constitute the unauthorized practice of law for your company's non-lawyer employee/agents to file Warrants in Debt for amounts to cover your insuredsí deductibles. See Rules of Supreme Court of Virginia, Part Six: Section I(B)(3); UPR 1-101(A); UPC 1-2.

The Committee believes that the right of the insured with respect to the recovery of the deductible interest is beyond the scope of this Opinion. It is the Committee’s understanding that the insured has the right to prosecute in its own name its claim for the deductible amount, in accordance with statutory authority, contract and insurance principles, and the Committee cautions that the insurance carrier should handle the enforcement of its claim with due regard to the rights of its insured.

This opinion is based only on the facts presented and is subject to review by Bar Council at its next regularly scheduled meeting in accordance with Part Six: Section I: ¶10(c)(iv) of the Rules of the Virginia Supreme Court. Should Council approve the Opinion, it will then be reviewed by the Supreme Court pursuant to Part Six: Section I: ¶10(f)(iii).

Summary:
Activities undertaken by a non-lawyer employee in General District Court on behalf of an insurance carrier/employer are governed by the statutory requirements of ¶16.1-88.03, Va. Code Ann. (1990 Cum. Supp.). Such statutorily permissible activity may be undertaken only on behalf of the employer and not on behalf of the insurance carrier/employer’s insured. It would constitute the unauthorized practice of law for the carrierís non-lawyer employee/agents to file Warrants in Debt for amounts to cover the insured’s deductible. The Committee cautions that the insurance carrier should handle the enforcement of its subrogation claim with due regard to the rights of its insured.

Committee Opinion
Issued March 12, 1991
Withdrawn June 7, 1991

Reconsideration Issued November 1, 1991

Second Reconsideration Issued
as Final Committee Opinion
June 12, 1992

Approved by the Supreme Court of Virginia
January 8, 1993, effective February 1, 1993
Updated: Aug 28, 2006